Newly released census data shows an increase of 16.7% in the number of 16 to 24 year olds living in communal establishments between 2011 to 2021. Although easy to assume this is simply down to the growth in student numbers, figures from the Higher Education Statistics Agency (HESA) tells a different story.
Student numbers have risen over the past ten years. The number of undergraduate and postgraduate student enrolments has increased from 2,503,010 students in 2010/11 to 2,751,865 in 2020/21 – with growth at 9.9%. This means there is a higher proportion of the student body living in community establishments, and not just a higher number.
“The new census figures reflect students’ increasing preference for communal establishments. We have seen demand grow over the past decade, particularly for purpose-built student accommodation (PBSA) that offers student renters a more lifestyle-focused approach to their accommodation.”Graham Hayward, Chief Operating Officer, Housing Hand
According to StuRents, the UK is on track to face a shortfall of around 450,000 student beds by 2025 – based on its analysis of the number of new beds likely to be delivered by that time compared to growing student numbers.
According to Housing Hand, a range of shifting factors are also making the situation more complex. Graham highlights that the UK was the first major international education centre to recover from Covid, with competition in Australia and US lagging behind in recovery terms. This has driven higher short-term popularity in the UK for oversees applicants for university places – a large number of them seeking PBSA or halls for their housing needs.
“Following a couple of years during which universities courted UK-based students more strenuously, due to international travel disruption, the accommodation sector is left racing to catch up with this renewed attention from oversees applicants. It makes sense from a funding perspective, as international students pay higher fees, but there is still also potential for disruption. Let’s not forget that China, which is beaten only by India in terms of the number of students being sent to the UK, is still facing significant Covid challenges.”Graham Hayward, Chief Operating Officer, Housing Hand
Another hangover from Covid is disruption to the supply chain of new homes in the PBSA sector – felt across the construction sector in terms of timelines, while global factors have also driven up material prices. With HMO’s closing due to legislation changes, this is causing additional supply issues of student homes.
“The student accommodation market is having to respond dynamically to a whole host of shifting factors at present. Universities are looking for ways to make the student experience more accessible to international applicants, such as partnering with Housing Hand to remove barriers to renting in the private rental sector, to maximise their higher fee potential. Some universities are also working with accommodation providers who are further away from campus, with arrangements in place to cover transportation costs in the short-term. We’ve seen this happen in Bristol, York, Edinburgh, Glasgow, Durham and various other UK towns and cities.”James Maguire, Head of Sales and Business Development, Housing Hand
With the cost of living leading to students questioning the value of obtaining a degree, many are exploring apprenticeships instead – where they can learn and work.
“The result of all this is pressure on all those concerned – on universities, accommodation providers and individual students and their families. University halls, PBSA providers, HMO’s and landlords in the private rented sector will all play a key role in the future of the UK’s student housing sector. In light of the current economic pressures, so too will guarantors. It’s a complex situation.”James Maguire, Head of Sales and Business Development, Housing Hand